Democrats’ push to boost minimum wage remains long shot despite Obama’s State of Union speech

WASHINGTON – A Democratic push to boost the federal minimum wage to $10.10 an hour is a long shot in Congress this election year, even after President Barack Obama made the increase a centerpiece his State of the Union address.

There is little suspense over the outcome. Few expect Democrats to muster the 60 votes needed in a showdown Senate roll call that Majority Leader Harry Reid, D-Nev., wants on the minimum wage by early March. Even if they do, the Republican-run House rejected a similar plan last year and seems unlikely to revisit the issue soon.

Regardless, Democrats — backed by Obama and labour and liberal groups — are eager for votes on raising the current $7.25 minimum wage, which was last increased in 2009.

Win or lose, the drive reinforces Democrats’ campaign-season effort to appeal to cash-strapped families and deflect Republican attempts to focus instead on the troubled startup of Obama’s health care law. The Democratic theme of narrowing the income gap between rich and poor — and trying to portray Republicans as uncaring — also includes legislation extending expired benefits for the long-term unemployed.

“If you put in a hard day’s work, you deserve decent pay for it,” Obama said Wednesday as he promoted his economic policies in Lanham, Md., a Washington suburb. “That’s a principle everybody understands, everybody believes.”

The night before, Obama announced in his State of the Union address to Congress and the nation that he will unilaterally boost the minimum wage to $10.10 hourly for some people employed under new federal contracts, an effort to prod lawmakers to enact the broader increase.

Supporters say a minimum wage increase would help low earners and spark the economy with additional spending by those workers. Adjusting for inflation, the minimum wage’s value peaked in 1968, when it was $1.60 hourly but had nearly 50 per cent more buying power than today’s $7.25.

“Someone who is dignified and works for 40 hours should not have to be in the poverty line, and that’s what they are,” Reid said Wednesday.

Arrayed against the proposal are Republicans and their business and conservative allies, who say a higher minimum wage would force businesses to shed jobs, reduce hours and raise prices.

“As part of our concern about creating jobs, the last thing we want to do is pass a measure to destroy jobs,” Senate Minority Leader Mitch McConnell, R-Ky., said.

Republicans also accuse Democrats of pitching the minimum wage issue as political attempt to upstage GOP efforts to focus voters on the glitch-plagued health care law.

“Democrats are turning back flips in purple shorts to try to distract the American people from the failures of ‘Obamacare,'” said Tennessee Sen. Lamar Alexander, top Republican on the Senate committee that handles labour issues.

A further complication is the acrimonious political climate that has settled over the Senate in recent months. Reid has weakened Republicans’ ability to filibuster and blocked many of their amendments, citing repeated GOP obstruction. The resulting sour mood will make it harder for Democrats to get 60 votes — which requires five Republicans — to keep a minimum wage bill alive.

A measure by Sen. Tom Harkin, D-Iowa, who chairs the Senate labour panel, would raise the federal minimum wage to $8.20 hourly six months after the bill’s enactment. Two more step increases would put it at $10.10 two years later. It would be adjusted annually after that to reflect inflation.

Rep. George Miller, D-Calif., who like Harkin retires from Congress next year, has introduced a similar House measure that has gone nowhere.

To shore up support from Democrats from GOP-leaning states, Harkin’s bill extends for three years a tax break letting small businesses deduct up to $500,000 worth of investments in the tax year they are made. Small businesses have been long-time foes of raising the minimum wage.

Senate Republicans say they are piecing together an alternative for helping struggling workers that could include tax incentives for job training and hiring and speed up federal approval of the proposed Keystone XL oil pipeline from Canada to the Texas Gulf coast. They say such proposals more directly address voters’ worries.

“A lot of Americans are concerned that we not make it more expensive and harder to hire workers,” Sen. John Thune, R-S.D., said.

Obama had proposed boosting the minimum wage to $9 hourly in his State of the Union address a year ago but now supports Harkin’s higher figure.

Democrats hope the issue will draw their supporters to the polls this fall. The party and its labour allies are working to put initiatives raising state minimum wages on this year’s ballots in South Dakota, where Democratic Sen. Tim Johnson is retiring, and Alaska and Arkansas, where Democratic Sens. Mark Begich and Mark Pryor, respectively, face tough fights for re-election.

Twenty-one states plus the District of Columbia already have minimum wages that exceed the current $7.25 federal level. Only nine states have wages either below the federal standard or have no requirement of their own. The other 20 states have minimum wages the same as the federal level.

About 3.6 million workers — around 1 in 20 of those paid hourly — earn the federal minimum of $7.25 or less, according to the Bureau of Labor Statistics. Nearly two-thirds are female, about half are under age 25, and more than one-third work full-time.

Liberals say Harkin’s bill would help an estimated 28 million people because it would prompt wage increases for those earning up to $10.10 hourly and for some earning more than that as employers adjust their pay scales.

Conservatives say a minimum wage boost is an inefficient way to help the poor because many of them are jobless and because some receiving minimum wages are teenagers from comfortable families.

Harkin’s bill would also gradually raise the $2.13 hourly minimum for people who rely heavily on tips by 95 cents a year until it reaches 70 per cent of the minimum for other workers.